EFG-Hermes Surges as QInvest Deal Approval Expected: Cairo Mover

EFG-Hermes Holding SAE (HRHO) jumped the most in more than three months after saying it expects Egypt’s financial regulator to approve the creation of an investment bank with QInvest next week.

Shares of the biggest publicly traded Arab investment bank rose 4.5 percent, the most since July 2, to 11.44 Egyptian pounds at the close in Cairo. That valued the company at 5.47 billion pounds ($898 million) and brought the gain for the year to 14 percent. The benchmark EGX 30 Index (EGX30) fell 0.4 percent today, paring this year’s advance to 54 percent.

EFG-Hermes has met with the Egyptian Financial Supervisory Authority and has “been assured that approval is on its way and that there are no problems,” EFG-Hermes Chairwoman Mona Zulficar said today in an interview. Approval is expected next week for the deal that stands to pay stockholders a 4-pound dividend a share.

“Renewed chatter on the super dividend is helping the name jog higher” after Zulficar’s comments, said Wafik Dawood, director of institutional sales at Cairo-based Mega Investments Securities.

The transaction would transfer ownership of the firm’s main businesses of brokerage, asset management and investment banking to a new entity in Qatar to be 60 percent-owned by QInvest, which has the option to buy the remaining shares after a year of its completion.

EFG-Hermes expects to complete the deal within two months once it has received approval from the EFSA, Zulficar said.

To contact the reporters on this story: Alaa Shahine in Dubai at asalha@bloomberg.net; Ahmed A. Namatalla in Cairo at anamatalla@bloomberg.net

To contact the editor responsible for this story: Claudia Maedler at cmaedler@bloomberg.net

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